Birmingham City Council again delays vote on payday loan, title pawn moratorium

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BIRMINGHAM, Ala. -- The Birmingham City Council this afternoon again delayed action on a proposed moratorium on payday loan and title pawn businesses.

The three-week delay comes after a lengthy debate and public hearing and months after the original ordinance was proposed.

More than a dozen people spoke in favor of the restrictions, while another crowd stood in opposition.

Councilwoman Lashunda Scales, who sponsored the ordinance, said the intent was to curb the proliferation of the businesses, which she said stifle other commercial development and prey on city residents.

Scales called another delay unnecessary.

"We did everything that we were asked to do," she said. The ordinance had been revised by city attorneys and had gone through the committee process.

But Scales ultimately did vote with the majority in its 7-2 vote to delay consideration of the ordinance.

Among the divided audience members were payday loan customers, some of whom called the businesses useful.

"I am in dire straits, as they say," said Joyce Vaughn of Birmingham. "I'm like everyone else, strapped for cash. I had nowhere to go. This was my only option."

But other former customers said the businesses exploit their customers with high interest rates that often trap people into debts they can never pay off.

A representative of AARP also spoke to the council, urging the new rules.

"It is predatory lending and it's unscrupulous," said Dr. Jack Bradford. "I'm talking about getting into people's pockets who can ill afford it."

I used to work for one of these businesses, this company also cashes checks for a certain % rate. Once you start one of these it is really hard to break the cycle. For awhile the State of Alabama was regulating them to where you could not have more than $500 out TOTAL for all places combined. I am not sure if they are still controlling that, but I remember having to tell people that they could not rewrite the loan because they had other loans out totaling more than that amount. You could see the desparation on the faces of people because they were having to rob Paul to pay Peter. It was heart breaking & I had to get out of that business because it will steal your soul...

Staying Safe with Reputable Payday Loan Lenders

Payday loans can offer a fast and simple solution to many difficult financial situations. If you find yourself suddenly in need of some extra money but cannot, or are not willling to, seek financial assistance through traditional loans from banks or other institutions, or through credit cards, taking out a payday loan can give you the relief you need. These loans do not require a credit check or colloteral so even if you have bad or no credit, or own nothing of real value, you are still eligible to receive one of these short-term cash advances.

There are two basic options for taking out a payday loan: an actual store or an online lender. Both have their advantages and disadvantages that should be considered as the first step toward taking out a payday loan.

Brick-and-Mortar Payday Loan Stores

These stores are a fixture in most urban neighborhoods, but are also available in shopping districts. Though their main focus is providing payday loans , these stores generally offer other financial products as well. These products may include prepaid debit cards, gift cards, money orders, wire transfers and authorized bill payments. This variety makes them very useful resources. Advantages to using such a store includes convenience for people who do not have access to a computer or the internet or who are simply more comfortable interacting with actual people. Disadvantages include the possibility of embarrassment and the necessity to actual go to the store.

Online Lenders

The biggest trend in taking out a payday loan is online lenders. These websites offer short-term loans paid as direct deposits into your bank account. You can also make payments through the site, making it an easy alternative. Advantages to the online option are confidentiality, convenience and variety. It is no one’s business but yours that you are borrowing money and doing it online keeps your private matters your own. These resources also permit you to submit all necessary information and fill out the application completely online so there is no need to go somewhere else. For people who like to make decisions based on comparison, there are hundreds on online lenders available.

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